2024 Wrap-Up: What’s Happened in Property and What’s Ahead for 2025

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2024 in Review

Interest Rates Held Steady
The Reserve Bank of Australia (RBA) kept the cash rate steady throughout 2024 at 4.35%.
Inflation has fallen substantially since its 2022 peak, with headline inflation sitting at 2.8% in the September quarter. However, underlying inflation remains slightly above the RBA’s target, which they don’t expect to meet until 2026.

This year also brought changes to the RBA’s decision-making process, with only eight cash rate meetings (down from 11), and greater transparency through post-meeting press conferences.

Property Prices Showed Slower Growth
While property prices rose across the country, growth slowed considerably. November marked 22 consecutive months of national price increases, but at just 0.1%, it was the weakest result since January 2023.

  • Standout Performers: Perth (+21% YoY), Adelaide (+14%), Brisbane (+12.1%)
  • Modest Growth: Sydney (+3.3%), Hobart (+1%), Darwin (+0.9%)
  • Declines: Melbourne (-2.3%), Canberra (-0.1%)

Rental Growth Slowed
After a prolonged period of rapid rental increases, demand cooled in many markets, leading to more modest growth. Sydney rents for houses hit a record $775 per week but recorded their weakest annual growth in four years.

Decreased demand was attributed to a rise in shared housing, intergenerational living, and reduced migration levels.

Government Incentives Rolled Out
In 2024, the government introduced initiatives to help aspiring homeowners:

  • Help to Buy Scheme: Shared equity contributions of up to 40% (new homes) or 30% (existing homes).
  • Home Guarantee Scheme: Allowed eligible buyers to purchase with a 5% deposit and no Lenders Mortgage Insurance.

Additional measures included a $300 energy bill rebate and tax cuts that increased some borrowers’ purchasing power.

What to Expect in 2025

Interest Rates May Drop
The RBA is expected to consider cash rate cuts in the first half of 2025, with some economists predicting a reduction as early as May.

Property Price Growth Could Slow Further
Many experts forecast weaker property price growth next year. National housing prices are expected to rise modestly by 1-4%, with potential declines in Sydney and Melbourne.

Federal Election and Housing
The federal election, due by May 2025, is likely to focus heavily on the housing crisis. Keep an eye on policies, such as the Coalition’s proposal to allow first home buyers to use up to $50,000 of superannuation savings for a deposit.

Planning a 2025 Property Purchase?

With interest rates expected to drop and property prices stabilizing in some areas, 2025 could be an exciting time for buyers.

If you’re thinking of purchasing a property, let’s discuss getting your finance pre-approved so you’re ready to move when the perfect opportunity arises.

Contact us today to start planning for your 2025 property goals!